'Phablets,' chips expected to drive Samsung's fourth-quarter revenue
By Miyoung Kim, ReutersSEOUL -- Samsung Electronics, the world leader in mobiles and memory chips, likely earned a quarterly profit of US$8.1 billion, as it sold close to 500 handsets every minute and as demand picked up for the flat screens it makes for mobile devices, including those for rival Apple Inc. products.
January 8, 2013, 12:23 am TWN
That run of five straight record quarters may end in January-March on weak seasonal demand, though a strong pipeline of smartphones — the South Korean group's biggest earner — and improving chip prices have eased concerns that earnings growth could slow this year, powering Samsung shares to record levels.
“Guidance is unlikely to disappoint given new product launches and a further upturn in cyclical parts of the business,” said Morgan Stanley analyst Shawn Kim. “Smartphone momentum has not decelerated, despite Apple's new iPhone, and the business continues to be driven by its flagship products.
“This time, it's the Galaxy Note II ... with the upside in unit shipments mainly from the U.S. We expect strong momentum to continue in the first quarter.”
While Apple rolled out just a single new smartphone, the iPhone 5, last year globally, Samsung bombarded the market with 37 variants tweaked for regional and consumer tastes, from high-end smartphones to cheaper low-end models. By comparison, Taiwan's HTC Corp. released 18 models, Nokia 9 and LG Electronics 24.
Samsung, valued at close to U$230 billion, gives its October-December earnings guidance later on Tuesday before the market opens. The full earnings release is expected by Jan. 25.
A High Note
Shipments of Samsung's flagship Galaxy S III, which overtook the iPhone 4S in the third quarter to become the world's best-selling smartphone, are likely to have slipped to around 15 million in the last quarter from 18 million in July-September. But estimated sales of around 8 million Galaxy Note II phone-cum-tablets, or “phablets,” should more than make up for that — pushing overall smartphone shipments to around 63 million, analysts estimate.
There has been increased speculation that Samsung will launch the next version of its Galaxy S in the first quarter, possibly with an unbreakable screen and full high-definition quality resolution boasting 440 pixels per inch, as well as a better camera and a more powerful processor.
“Samsung's smartphone shipments are likely to grow even in a seasonally weak first quarter. The early launch of the Galaxy S IV would drive second-quarter growth momentum,” said BNP Paribas Securities analyst Peter Yu, who predicts Samsung's 2013 operating profit will grow 25 percent to almost US$35 billion.